S mall and Medium Enterprises (MSEs) set the way straight for the realization of Ethiopia’s ambition of becoming hub of light manufacturing firms. Youths who get ample skills training, and financial supports employ their innovation to come up with marketable manufacturing products. The experiences and capital they gather over time could also serve to run larger and more sophisticated firms.
So much has been achieved thus far in this regard though MSEs own limitations and inadequacy of supports usually stand as greasy pole to their full development. Last week, Federal Small and Medium Manufacturing Industry Promotion Authority launched an eight-day long exhibition and bazaar in Addis Ababa, with the aim of helping accelerate the development of the manufacturing sector through creating market linkage to operators.
The organizers forecasted as over 20,000 visitors could buy products or simply pay a visit to the event which could be important to operators to create brand awareness, not to mention the close to one million Birr they could earn from market created as a result of it. Moreover, operators, stakeholders and buyers can have good opportunity to network among themselves.
Launching the event that brought some 129 participants drawn from 85 MSEs as well as around 36 stakeholders, among others, Industry State Minister Yohannes Denkayehu said the Ministry has been offering various supports with a view to creating conducive environment to the operation of MSEs.
He mentioned the provision of manufacturing sheds, production machineries, loan, trainings, industry extension supports and market linkages. Bethlehem Girma who engaged in honey processing business at Finote Selam in west Gojjam Zone of the Amhara State had this to say: “Shortly after our company started operation, we managed to grow our capital to 100, 000 Birr from 20, 000 Birr. Still, we need more support from the government and other stakeholders to be able to keep in the business being competitive in the market.”
To her, modern manufacturing area should be considered to make them more productive and transform their business to the next level. Elizabeth Mesfin, owner of a spices processing enterprise in Addis Ababa buys Bethlehem idea. She added that operators engaged in food and beverage sector can reap more benefits to them if government’s and other stakeholders’ supports continue uninterrupted. “I had only 5,000 Birr capital when I started this business six years ago. But now my capital has grown to around 400,000 Birr. My enterprise offered employment to 10 fellow Ethiopians.”
Elizabeth indicated that her products which are entirely organic can penetrate international market if she gets the opportunity. She has proven this true during her tour to three different countries. Experts that undertake studies in spices sector also found out that the diversity in taste even within the same species of spice, resulting from agro-climatic variations in the country, is also additional factor for Ethiopian spices to be competitive internationally.
For a country with bulging youth population, SMEs job creation role is undeniable. Government’s supports as expressed by the State Minister have to continue in this regrad. The second Growth and Transformation Plan has laid goals to the sub-sector with full recognition to its role to rural and urban job creation. The document indicates that “availing adequate (finance) credit, creating market linkages/ networks and creating conducive climate for business activities will be carried out in order to make these business operators [SMEs] profitable through enhancing their competitiveness in price, quality and quantity.”
To support the role of SMEs, the government had also introduced a 10-billion revolving Birr fund. But, the fund’s management seems to face challenges. As Prime Minister Dr. Abiy Ahmed told the parliament recently, only one percent of the fund disbursed to regional governments has so far been collected. Such and other limitations surfaced in the sector have to properly be addressed to be able to help SMEs meet the desired goals.
Herald February 8/2019
BY BETHLEHEM ASFAW
